L’INDUSTRIE D’ASSURANCE ET SON ROLE D’INTERMEDIATION FINANCIERE DANS LE DEVELOPPEMENT ECONOMIQUE, CAS DU RWANDA : EVALUATION DE 2008 A 2012

Abstract

An insurance company is considered as a seller of the insurance product to the buyer who is called policyholder. With its main economic principles like a large number of homogeneous exposure units, affordable premium and limited risk of catastrophically large losses among others, the insurance industry is counted among big financial intermediaries as confirmed by some researchers like Bencivenga and Smith quoted by André Besson and Picard (1995), and CHICHTI Jamel Eddine, (2001) as well.
Being the life or non life insurance intermediation, the three traditional important roles in economic sector are effectively played within insurance activity: Firstly the role of being economic agent, secondly the role of financial intermediary in being institutional investor in one hand and participating to the transformation of savings on the other hand; and thirdly the role of being a relay for economic policies. In underwriting operation, the insurer and insured have an agreement through their contract to pay a premium in first stage and as consequence to have a financial assistance throughout a process of compensation based on statistics and pre calculation of risk likelihood. Such operations in insurance industry are done in intermediation environment where an insurer is obliged to invest the money received from insured in order to multiply the financial means gained. Doing so, an insurer shall be able to give indemnities and have at the same time the remuneration of the capital as financial profit for shareholders.
In this regard the importance of reinsurance operations can be mentioned in the contribution to the economic development in conjunction with the traditional insurance activity that it reinforce on the high level.
As confirmed by researchers like Karl Borch (1968), the traditional role of insurance industry as an institutional investor and through the concept of supply and demand is shown herein. In fact, the reinforcement of the economic development through capitals and technical reserves put into economy is obvious. According to various financial ratios of the insurance industry in the Rwandan financial system, the assessment shows that the importance of this industry in the economy through premiums and claims paid and injected into economy in one hand, and reinsurance financial transactions on the other hand, is confirmed.
The contribution of the industry in financial services and in economic development is obvious through the percentage of its share in GDP which is important in regards with the little penetration rate of insurance market; this being a result of lack of insurance culture among African people in general and Rwandans particularly: this rate is assessed around 5% only.
If the penetration were improved, then the share of the insurance services in the GDP would be obviously - things being equal- more important.